Scenario approach to predict the poverty rate in the Russian Federation

All societies faced the problem of poverty at all times. Nowadays, it remains the urgent challenge for every state. Despite the best efforts of scientists and experts to find ways for poverty reduction, the dynamics of this phenomenon is intensified. Besides, there is no unified interpretation of the poverty line to assess its scope. The successful solution of this problem requires a comprehensive study and scientific justification for applying the tools of many sciences. Statistical analysis and prediction techniques will contribute to a deeper analysis of the phenomenon of poverty and enable one to predict its variation. The study presents an outlook for the number of people living below the poverty line by means of a distributed lag model up to 2020. The prediction is made according to realistic, pessimistic, and optimistic scenarios. The prerequisites for the least squares method performance are checked with the help of several statistical tests such as White Test for Heteroskedasticity, Breusch-Pagan Test for Heteroskedasticity, Breusch-Godfrey Serial Correlation LM Test. The author substantiates the fact that the poverty rate at a particular time is determined by the average cash income not at the present time but in the past. The relationship between these indicators is reversed.